[Editor’s note: KHN is not affiliated with Kaiser Permanente.]
California lawmakers have authorized a controversial no-bid statewide Medi-Cal contract for HMO large Kaiser Permanente over the objection of county governments and competing well being plans. However key particulars — together with what number of new sufferers KP will enroll — are nonetheless unclear.
On June 30, with little fanfare, Gov. Gavin Newsom signed the invoice that codifies the deal, regardless of considerations first reported by KHN that KP was getting preferential therapy from the state that may permit it to proceed enrolling a more healthy pool of Medi-Cal sufferers, leaving different well being plans with a disproportionate share of this system’s sickest and costliest sufferers. Medi-Cal, California’s model of Medicaid, the government-funded medical health insurance program for folks with low incomes, covers practically 14.6 million Californians, 84% of whom are in managed-care plans.
Now that the talk is over, opponents of the KP deal are trying forward.
“We stay up for working with the state on implementing the statewide contract, and we’ll proceed to advocate the worth and significance of native plans in offering care to their communities,” stated Linnea Koopmans, CEO of Native Well being Plans of California, which spearheaded the opposition.
Kaiser Permanente is a large participant in California’s medical health insurance market, masking practically 1 / 4 of all Golden State residents. However its barely lower than 900,000 Medi-Cal enrollees are solely about 7% of that program’s whole managed-care membership.
Kaiser Permanente has lengthy been allowed to restrict its Medi-Cal membership by accepting solely individuals who have been KP members within the latest previous — primarily in employer-based or Inexpensive Care Act plans — and their rapid members of the family.
Beneath the brand new legislation, the variety of Kaiser Permanente enrollees in this system “could be permitted to develop by 25%” over the five-year lifetime of the contract, ranging from its stage on Jan. 1, 2024, when the contract takes impact, stated Katharine Weir-Ebster, a spokesperson for the Division of Well being Care Companies, which runs Medi-Cal. However that 25% determine is just not within the textual content of the legislation — and the exact magnitude of the meant enrollment improve for KP stays unclear.
Presently, most of KP’s Medi-Cal members are coated by subcontracts with native, publicly ruled well being plans across the state. Beneath the brand new legislation, these members could be coated instantly by Kaiser Permanente beneath its statewide contract. Proponents say the change will improve effectivity, cut back confusion for customers, and make Kaiser Permanente extra accountable to the state.
Opponents have argued that having a nationwide behemoth compete with native plans — particularly in locations akin to Orange, Ventura, San Mateo, and Sonoma counties, the place county-operated plans have been the only real Medi-Cal choice — might weaken group management over well being care and compromise the protection web system that serves California’s most weak residents.
The brand new legislation commits KP to growing its footprint in Medi-Cal by accepting sure classes of latest enrollees, together with present and former foster care youths, children who’ve acquired providers from one other little one welfare company, seniors who’re eligible each for Medi-Cal and Medicare, and enrollees who fail to decide on a well being plan and are assigned one by default.
Almost half of Medi-Cal enrollees in counties with a couple of well being plan are assigned by default, Weir-Ebster stated. The legislation, nevertheless, doesn’t specify what number of default enrollees Kaiser Permanente will settle for, saying solely that the quantity might be primarily based on KP’s “projected capability” in every county or area.
One other important supply of enrollment development for Kaiser Permanente might be sufferers — and their members of the family — transferring out of KP industrial plans in counties the place KP might be a Medi-Cal choice for the primary time.
Some outstanding shopper advocacy teams argue that any improve in Kaiser Permanente’s Medi-Cal inhabitants is a optimistic growth, particularly for the reason that HMO will get excessive marks for the standard of its care.
“We expect that system is one thing that extra Medi-Cal members ought to have entry to, and this invoice is a step in that route,” stated Kiran Savage-Sangwan, government director of the California Pan-Ethnic Well being Community, which advocates for fairness in well being care.
Kaycee Velarde, head of Medi-Cal contracting for KP, stated by way of electronic mail that the deal will give extra folks “entry to our high-quality Medi-Cal managed care plan” and permit for higher collaboration with the state “to enhance high quality for a broader variety of Medi-Cal enrollees.”
However precisely how the brand new association will work stays unclear.
The specifics — together with the enrollment development determine — are anticipated to be enshrined in a memorandum of understanding separate from the contract. That has raised some eyebrows, since MOUs are usually not usually binding in the identical approach contracts are. Neither is it clear when the small print will come.
“Our expectation is that the Division of Well being Care Companies is growing the MOU,” Velarde stated. The division doesn’t have an estimate of when a draft might be issued, Weir-Ebster stated.
Many skeptics of the deal stay involved about its affect on the safety-net inhabitants. The legislation says Kaiser Permanente will present the “highest want” specialty providers to non-KP members in sure areas of the state. Nevertheless it doesn’t specify which providers or the place they are going to be offered. These particulars, anticipated to be within the MOU, haven’t but been determined, Weir-Ebster stated.
Leslie Conner, CEO of Santa Cruz Group Well being, which runs three clinics in Santa Cruz County, stated entry to specialty care is a problem for sufferers. “That’s going to be a remaining downside that I hope Kaiser would work with the group to handle,” she stated. “If we don’t all determine it out collectively, there’s going to be winners and losers, and, actually, the losers are at all times the low-income folks.”
Lawmakers did make a small variety of adjustments to the unique invoice meant to handle opponents’ considerations. Certainly one of them, geared toward native well being plans’ concern of getting a sicker pool of Medi-Cal enrollees, says all Medi-Cal managed-care plans needs to be paid in “an actuarially sound method” consistent with the medical threat of their enrollees.
One other one directs the state to evaluate, earlier than the contract begins, whether or not KP is sufficiently complying with behavioral well being protection necessities. The well being care large has come beneath hearth lately for offering insufficient psychological well being providers, and the state Division of Managed Well being Care is investigating the HMO’s psychological well being program after a pointy improve in complaints, stated Rachel Arrezola, a division spokesperson.
Sal Rosselli, president of the Nationwide Union of Healthcare Employees, which has waged a pitched battle in opposition to KP over psychological well being care, stated the availability within the new legislation to evaluate compliance is inadequate. The union had needed KP to bear an annual certification course of that may have barred it from enrolling new Medi-Cal enrollees in any yr it wasn’t licensed.
“Are you able to think about any well being plan could be granted such a big enlargement of its Medi-Cal contract if it couldn’t present remedy for most cancers or cardiac care?” Rosselli stated.
In the end, KP’s contract creates extra selection for the Medi-Cal inhabitants, stated Linda Nguy, a lobbyist with the Western Middle on Legislation & Poverty. However the group, which advocates for folks with low incomes, pledged to control how the brand new legislation is rolled out.
“We might be monitoring it and positively elevating points as issues come up,” Nguy stated.